Britain suspends rail franchises due to coronavirus
An unprecedented upheaval has been occurred on Monday, 23 March, for the British rail sector. The numerous experts have been talking about its renationalisation for many years. And now it has happened. At least, partially and for a period of six months. Such an extraordinary decision was caused by the spread of coronavirus in the United Kingdom.
“My absolute focus is on making sure services continue so that journeys that are vital in tackling this crisis can continue to take place, so today (23 March 2020), to make sure our railways stay open, we are providing train operators on franchises let by my department the opportunity to temporarily transition onto Emergency Measures Agreements. These agreements will suspend the normal financial mechanisms of franchise agreements, transferring all revenue and cost risk to the government,” Transport Secretary Grant Shapps noted in his official statement.
According to him, the suspension of the franchising system does not mean the implementation of a new model in the UK rail sector. “It is a temporary solution, taking the steps necessary to protect services now in a cost-efficient way, and ensuring current events have as little impact as possible on the railway in the longer term,” the official specified. Meanwhile, the train operating companies will continue their “day-to-day services for a small, pre-determined management fee”.
The unprecedented decision allows the UK government to better react to the new circumstances caused by the coronavirus outbreak. Among them is the remarkable decrease in passenger traffic in Great Britain during the last week. The island country did not impose such strong restrictions on train traffic as continental Europe did. However, the UK’s rail sector has been also hit by this trend due to the governmental recommendations to stay home and limitation of public activities across the country. “The railways have already seen up to a 70 per cent drop in passenger numbers. Rail fares revenue has also reduced as people increasingly work from home and adopt social distancing, with total ticket sales down by two-thirds from the equivalent date in 2019,” Mr Shapps added.
It is worth to note that the above-mentioned decision does not have an impact on the open-access operators like Hull Trains, Heathrow Express, Grand Central and Eurostar. They continue their operations according to their own estimations. In spite of this, they are also reducing the number of their train connections.